The European Commission published its proposal to establish the EPPO in July 2013. Its aim was to create an EU-wide body responsible for investigating, prosecuting and bringing to justice those who commit fraud against the EU’s finances.
The Coalition Agreement, signed by the Government in 2010, said that the UK will not opt-in to any EPPO. The European Union Act 2011 also said that the UK could not participate without a referendum taking place. In October 2013 the House of Lords, along with 13 other legislative chambers of Member States, submitted reasoned opinions challenging the Commission’s proposal on the grounds of subsidiarity. However, the Commission decided to press on with its proposal unamended, then, in March 2014, the Presidency produced an alternative text.
The report highlights a number of problems with the two texts currently under discussion and their potentially significant ramifications for the UK’s future relationships with OLAF and Eurojust. The report argues that the Commission’s proposed EPPO would be in danger of being overwhelmed by its workload, and its structure would not be robust enough to enable it to monitor its investigations in the participating States. The Committee predicts similar problems with the Presidency’s alternative. The evidence on the proposed introduction of a collegiate structure into the EPPO - mimicking Eurojust’ structure - overwhelmingly suggests that this would further complicate matters.
The report calls on the Government and the European Parliament to make sure that the adopted text safeguards the position in OLAF and Eurojust of those Member States not participating in the EPPO.
Chairman of the Sub-Committee, Baroness Corston, said:
“The Committee were disappointed with the Commission’s decision to continue with its proposal unamended. This prompted my Committee to launch this inquiry, in order to consider the potential impacts of the EPPO for the United Kingdom, particularly for the UK’s ongoing participation in the European Anti-Fraud Office (OLAF) and Eurojust. These agencies are of vital importance to the EU’s ongoing fight against fraud.
“My Committee is concerned that the EPPO could seriously undermine the UK’s essential relationships with OLAF and Eurojust. In addition, we believe that an EPPO enjoying exclusive jurisdiction for EU budget fraud would be in danger of being overwhelmed by its workload.
“As part of the continuing negotiations on the EPPO, we urge the Government and other parties involved to ensure that any Regulation agreed contains assurances safeguarding the UK’s position in OLAF and Eurojust.”
Other recommendations contained within the report include that:
- the Government do more to promote its vision of how to address the problem of fraud against the EU’s budget;
- the Home Office urgently begin a consultation on the legislative changes necessary in order to ensure that the UK authorities and courts are able to respond to requests for assistance from the EPPO; and that
- the Regulation reforming Eurojust and establishing the EPPO clearly addresses the position of non-participating Member States.